peHUB Wire: Wednesday, May 20, 2009

Top Three

Vista Equity Partners has increased its offer for SumTotal Systems for a second time to $4.85 per share in cash, or $4.95 per share depending on developments in the company’s breakup fee with Accel-KKR. The bid tops rival bidder Accel-KKR’s sweetened offer for the company from yesterday of $4.80 per share. The company yesterday announced it would maintain its agreement to sell to Accel-KKR, but at an increased price after Vista Equity Partners submitted a higher bid during the deal’s go-shop period.

Software maker SolarWinds Inc’s shares priced at $12.50 per share in the company’s initial public offering Tuesday, above the estimate range, the company said. The company has raised around $48.5 million in VC funding from Bain Capital Ventures (31.6% pre-IPO stake), Insight Venture Partners (31.6%) and Austin Ventures (3.4%).

J.G. Wentworth, a specialty finance company that buys structured settlements and annuities, filed for bankruptcy on Tuesday, saying it had a “prepackaged” reorganization plan supported by more than 90 percent of its lenders. The company is backed by JLL Partners.

VC Deals

Braemar Energy Ventures (Braemar), an early-to-mid-stage energy technology venture capital fund, made a $10 million investment in Fulham, an assembler and distributor of electronic ballasts for lights.

Valero Energy Corp., based in San Antonio, Texas, has made an investment in Qteros, a Massachusetts-based energy technology company. Valero established its investment in Qteros through its acquisition of certain assets of Verasun Energy. The company has in the past received funding from Venrock, Battery Ventures, BP, and Soros Fund Management.

Daimler is taking a 10 percent stake in U.S. electric car start-up Tesla Motors.

Opsna Therapeutics received an additional €3.3 million to the Series B financing it announced in February this year, bringing the total round to €21.3 million. The commitment is from Roche Venture Fund and Enterprise Ireland. Other investors in the round include Novartus Fund, Fountain Healthcare Partners, Inventages Venture Capital and Seroba-Kernel. Opsana is a biotechnology company in the autoimmune and inflammatory disease field.

Elixir Pharmaceuticals, a developer of metabolic disease drugs, has completed a $12 million equity financing led by MPM Capital, via MPM Bio IV NVS Strategic Fund. Additional investors in the round include ARCH Venture Partners, Oxford Bioscience Partners, the Omega Fund and Physic Ventures. Further, Elixir announced an option agreement with Novartis giving the pharmaceuticals giant the option to acquire Elixir at a potential $500 million or greater deal value, pending the successful completion of an upcoming clinical study.

Axcient Inc., a Mountain View, Calif.-based SaaS business, topped of its $6 million Series A round of fundraising with an additional $2 million commitment from Thomvest Ventures. Other investors in the round include Allegis Capital and Peninsula Ventures.

CMOSIS NV, a CMOS image sensor supplier based in Antwerp, Belgium, concluded its second round of financing with $1.52 million (€ 1.11 million) from present shareholders, new personnel and management. The round coincides with the appointment of Luc De Mey as CMOSIS CEO and President.

Buyout Deals

Atlanta Equity Fund LP announced today its affiliate has acquired Richmond Cold Storage Company, Inc., a Virginia-based company which operates a network of managed temperature-controlled warehouses. The deal value was not disclosed.

Troubled Florida lender BankUnited Financial Corp has drawn at least one bid from a private equity consortium that includes WL Ross & Co, Reuters reported. Besides Ross, the consortium also includes Carlyle Group, Blackstone Group LP and Centerbridge Capital Partners LLC.

RHJ will make an offer for General Motors’ German carmaker Opel, Reuters reported. The newswire said the offer would give General Motors a substantial stake in the business.

Hale Capital portfolio company LocationLogic has sold to TeleCommunication Systems Inc. for $25 million just two months after the New York-based firm purchased it for an undisclosed amount.

Thoma Bravo’s deal to purchase Entrust Inc. has been called into question, as the company disclosed in an SEC filing that it received three higher indications of interest doing its “go-shop” period. The company’s board recommends Thoma Bravo’s offer but said it continues discussions with the three parties.

PE Exits

Victory Pharma, a San Diego-based developer of pain treatment drugs, has sold to Sciele Pharma. for $150 million. Victory Pharma raised $45 million in March from Essex Woodlands Health Ventures and Ampersand Ventures.

PE-Backed IPOs

Facebook CEO Mark Zuckerberg hopes to eventually take his company public but said it won’t be for a few years, and stressed that the world’s largest online social network is in no immediate need of capital.

Hertz Global, backed by Clayton, Dubilier & Rice, Inc. and The Carlyle Group, plans to offer 40 million shares in a registered public offering. CD&R and Carlyle intend to purchase $150 million on common stock. The company will also offer $250 million worth of convertible senior notes. The company plans to use to proceeds to increase liquidity and repay debt. The firm’s buyout investors have recouped their investment through dividend recapitalizations and public offerings in 2006.

PE-Backed M&A

Wachovia Capital Partners has acquired through its portfolio company HostMySite, Inc. Golub Capital provided a $22 million senior credit facility to support the acquisition. Wachovia Capital Partners acquired HostMySite in 2008 and the firm contributed additional equity to close the transaction.

Brooks Instruments, a portfolio company of American Industrial Partners, has acquired Key Instruments, a flow meter maker based in Pennsylvania. Deal terms were not disclosed.

Firms & Funds

Sun Capital Partners has received approval for amendments to its fourth buyout fund, LBOWire reported. The amendment consists of a $150 million preferred investment in fund four to provide liquidity to portfolio companies with new capital from existing investors and from fund five.

Human Resources

Water Street Healthcare Partners has appointed Peter Strothman to principal and Max Mishkin to vice president. Strothman joins Water Street from JLL Partners where he worked on a range of health care investments. Mishkin most recently worked with Waud Capital Partners where he focused on investments in the healthcare services sector.

Jason Mueller will be rejoining the Saw Mill team as a Vice President after completing his MBA at Columbia University. Prior to business school, Jason worked for Saw Mill Capital as an Associate, in which role he supported both new investment activity and portfolio management.

Superior Capital Partners, a Detroit, Mich.-based private equity firm, appointed of Scott Hauncher as a Managing Director. Hauncher joins Superior Capital from Long Point Capital.